Archive - Aug 12, 2009
Don't Be Too Bearish on the Bonds, Seriously
Submitted by on 08/12/2009 22:44 -0500Everybody loves to hate the bonds. “Confetti”, “certificates of confiscation”, “wall paper” are some recent terms used to describe them. I agree, it sounds like a loser's bet to give your money away to that “malfunctioning corporation called America” (Gordon Gekko, correct me if I am misquoting) for a measly 3.75% a year for 10 years. So why not short them?
The Everyman's Guide To The Credit Crisis
Submitted by Tyler Durden on 08/12/2009 21:23 -0500Must read
Treasury's New Solution: "Greenies"
Submitted by Bruce Krasting on 08/12/2009 20:36 -0500The Fed's decision to wind down their bond purchase program puts more pressure on Treasury. Geithner and Co. are working on a plan to solve these minor problems. Greenies are coming.
The $500/Email Bankruptcy Bonanza, Or Does Capstone Heart Flight Club
Submitted by Tyler Durden on 08/12/2009 19:11 -0500Bankruptcy advisors are increasingly having to defend the exorbitant fees (expenses, not so much - see below) that they are charging from their zombied clients, which in the absence of traditional banker products has become one of the primary sources of revenue for whatever is left of the financial advisory industry. A wonderful case in point is today's defense by Evercore of the ridiculous fees they collected for quote-unquote advising on the most predetermined and advice-remote transaction in the history of bankruptcy, i.e. the nationalization of General Motors via the stalking horse legitimization mechanism.
Elizabeth Warren "We Have A Real Problem Coming"
Submitted by Tyler Durden on 08/12/2009 17:13 -0500The head of the Congressional Oversight Panel provides a solid dose of reality, and some scary words for the bulls.
Daily Credit Summary: August 12 - Bearish Breadth
Submitted by Tyler Durden on 08/12/2009 16:19 -0500Spreads were mostly wider in the US today as ExHVOL is the only index tighter thanks to HVOL's underperformance (with HY underperforming IG as the former broke above 800bps intraday). Indices generally outperformed intrinsics (as it appears single-name protection buyers were hedging with index protection) with skews widening in general as IG's skew decompressed as the index beat intrinsics, HVOL outperformed but widened the skew, ExHVOL outperformed pushing the skew wider, XO's skew increased as the index outperformed, and HY outperformed but narrowed the skew. IG opened gap at its wides and did leak tighter most of the day but intrinsics did not follow and the weakness in HY suggests that investors were looking at HY-IG decompression.
Closing Market Summary
Submitted by Tyler Durden on 08/12/2009 15:06 -0500
- IG Wider 0.5bps to 113.5
- HY Wider -7/16 to 89 7/16
- Stocks... closing at VWAP.
AMAT Starter Pistol Fires, FOMC Speaks, and Girls Go Wild
Submitted by RobotTrader on 08/12/2009 14:47 -0500Another classic 1999 day where the "AMAT train is leaving the station" starter pistol is fired to get the SMH greyhounds running, and Bernanke utters some soothing words for the speculators to start a post-FOMC party.
Afternoon Market Summary
Submitted by Tyler Durden on 08/12/2009 13:55 -0500IG12: 114bps + 1.5 bps (weaker)
IG12 intrinsics: +6 bps (much weaker)
HY12: 791bps + 10 bps (weaker)
HY12 intrinics: +31 bps (much weaker)
30 Year: 4.52%, +8 bps (weaker)
DXY: poundage
Equities: who cares, just feed more redbull to WOPR
Substantial Confusion Percolates On Volume Ramp
Submitted by Tyler Durden on 08/12/2009 13:38 -0500
Left Right Left Right Up Down Up Down A B A B Reset Start (Triangle Square for extra lives)
FOMC Minutes
Submitted by Tyler Durden on 08/12/2009 13:17 -0500QE Ending: "To promote a smooth transition in markets as these purchases of Treasury securities are completed, the Committee has decided to gradually slow the pace of these transactions and anticipates that the full amount will be purchased by the end of October."
The Feds & UBS Reach a Squeal of a Deal
Submitted by Travis on 08/12/2009 12:28 -0500Yeah, the Swiss... "Oh, they're neutral? right?" Haven't they always been? "They say nothing?" Well, maybe not then- but now, the Feds and UBS AG have reached a deal to squeal on some 52,000 potentially tax-evading Americans.
$23 Billion 10 Year Auction Results
Submitted by Tyler Durden on 08/12/2009 12:13 -0500
Results out: only $14.4 billion indirects tendered out of total $57 billion competitive. Of the $14.4 billion, $10.4 billion was allocated. Indirect bids 45.7% vs. Avg. 35.25% (Prev. 32.11%). Indirect bid-to-cover was 1.39. Overall bid-to-cover including highly motivated primary dealers was 2.49. Allocated at 3.734% high yield vs expected 3.708%.
IWM-SPY Unwind In Process?
Submitted by Tyler Durden on 08/12/2009 11:47 -0500
Crap stocks (RUT) outperforming quality (SPY) again. The early morning action was likely precipitated by some colorful index arbing.






